In what can only be called a highly disruptive move, Anil Ambani’s Reliance Communications has made all voice calls in India free for those who recharge with a coupon of Rs 149 per month.
The impact of the move will be greater than that of Reliance Jio’s similar tariff, as this tariff is valid on 2G, 3G and 4G calls.
“RCOM’s revolutionary Unlimited Plan is set to change the dynamics of mobile recharges in India, as customers move away from the traditional Revenue Per Minute tariff model to a service subscription model based on ARPU,” the company said.
“The ‘149 Unlimited’ Plan, available across the 2G, 3G and 4G technology platforms, is targeted at incentivizing 2G, 3G and 4G handset-owners across India to move to the RCOM network.
“There are still hundreds of millions of older 2G handset-owners in India, and RCOM is positioning the unique plan to migrate these customers to its network, along with 300 MB of data usage,” it said.
Regardless of the type of Feature Phone or Smartphone used, customers will get unlimited voice calling, including STD calls, to any phone on any network in India—plus 300 MB of data access on RCOM’s best-in-class 2G, 3G & 4G networks.
“Our new pioneering yet simple Unlimited Plan has the potential to trigger a paradigm shift in the way Indians recharge their mobile phones, creating a significant shift in the telecom market—as it moves away from the ‘Unit Rate’ charging regime to a ‘Single Recharge and Unlimited Usage’ regime. It enables customers with any kind of handset to have unlimited calling time across the country, in addition to data access on all 2G, 3G and 4G handsets. Our Unlimited Plan will see millions of Indians benefit, and help RCOM ramp up its customer base and engage with higher-value customers and greater ARPUs.”
Though RCom’s network coverage is not comparable to those of Bharti Airtel and others, this move could cause significant disruption to their profits and revenues. The incumbent operators get about 45-50 paise per minute for each voice call, while this kind of tariff will bring it down to about 16 paise per minute.
It remains to be seen whether RCom can improve its coverage as it increases the number of towers and integrates with Aircel and MTS in the coming months.
For now, Bharti Airtel and Idea Cellular’s shares have not shown much impact. RCom’s shares, which used to trade at around 50 rupees, is now trading at 35.60. They have lost 25% of their value this month.
“Since outgoing voice calls are unlimited and free with the new plan at just Rs 149 per month, along with 300 MB of data, all customers need to recharge their accounts for is additional data requirement, if any,” the company said.
RCOM said already has in place a bouquet of attractive add-on data plans, with which customers can opt for customization of their additional data usage needs.
“These additional data usage plans are available across 2G, 3G and 4G, with customers getting data access depending on their handset-type. These offers provide customers with several options that meet individual requirements and are set to change the way Indians recharge their mobile phones.”
However, according to RCom’s website, its data packs are priced well above what others are charging. For example, 1 GB of 4G data is priced at Rs 250-300, depending on the circle, and 10 GB at Rs 1,400-1,850, again depending on the circle. Airtel and Idea offer 2 GB for Rs 250 and 10 GB for Rs 1000.
RCOM’s ‘149 Unlimited’ plan will, therefore, be a great value proposition for customers, apart from doing away with the hassle of multiple recharges and keeping constant track on their account balance after every outgoing voice call. There is no hidden charge or any ‘Conditions Apply’ on RCOM’s ‘149 Unlimited’ Plan.